I’ve written a lot about the still-smoldering lawsuit over HRJ Capital, the celebrity venture capital firm formed during the dot-com bubble by Joe Montana and two other ex-49ers. When the bubble burst, the firm collapsed, and its assets were bought by Swiss firm Capital Dynamics.

What the Swiss didn’t (heh heh) bank on was that they were also buying the legal claims of three former HRJ managers that they were owed millions in back pay. Last spring, a San Jose jury shot down Capital Dynamics’ arguments that it shouldn’t be held responsible for the actions of the funds’ prior management firm. The case centers on something called agency theory; in effect, the jury said Capital Dynamics has to make good on HRJ’s promises to the plaintiffs, because those promises were made on behalf of the funds that Capital Dynamics now controls.

With various motions on the case scheduled to be heard Aug. 1, Capital Dynamics has now landed a powerful ally. CalPERS, the pension fund for California state employees, boasts an investment portfolio of more than $250 billion, making it one of the most influential investors in venture capital (and other kinds of private equity).

CalPERS agrees with Capital Dynamics that Santa Clara County Superior Court Judge James Kleinberg erred in November when he refused to throw out the case. In its filing, PERS writes that the investment funds HRJ raised “were contractually formed to clearly delineate – and limit – the funds’ liability for the obligations of the management company.” In essence, the argument goes, whatever promises HRJ made to the plaintiffs became void when HRJ folded.

Interestingly, CalPERS isn’t an investor in any of the HRJ funds, but it filed the friend-of-the-court briefing out of concern for the precedent the case could set. “Judge Kleinberg’s conclusion and reason in the agency issue could have a harmful impact on large institutional investors, such as CalPERS, and on the private investment fund industry in California,” the filing states. You can read the whole filing here: CalPERS Amicus Curiae Brief ISO Funds and Def CD

UPDATE: Judge Patricia Lucas, who oversaw the trial last spring in which the jury held Capital Dynamics liable for the money owed the plaintiffs, denied to hear the CalPERS filing. She wrote: “CalPERS does not have an interesting [sic] in the proceedings that would warrant permission to file a brief.” In a ruling Aug. 12, Lucas also refused the Swiss firm’s request to throw out the jury award, which included hefty (and, I’m told, unusual) punitive damages. Another hearing, slated for Aug. 30, will determine the final price tag, including interest, that Capital Dynamics will be on the hook for … at least, pending appeal.